Universal Credit / Divorce Settlement

RobinHill

Hello,

I am a 52 y/o male who is going through a divorce after 27 years of marriage. I am disabled with a progressive neurological condition and currently receive DLA higher rate Mobility and middle rate care, together with Universal Credit LCWRA. The divorce settlement may well result in my receiving a significant sum (well in excess of £16k). I own my own home however it does not meet my health needs (this is documented by social services).

Could you help in understanding what my options are, for instance would I be allowed to purchase a new home better suited to my needs with out affecting my UC status?

Thank you.

Alice_Holt

I would suggest when you get the settlement you notify DWP, and ask if a decision maker could give you a ruling on whether this would be regarded as deprivation of capital. Have all your evidence ready to give to the DM to support your case that it shouldn't be regarded as deprivation.

It is possible to appeal DM decisions to tribunal, should a decision go against you. The key aspect is whether you spent the money to retain a means tested benefit.

It is likely to be a matter of judgement given the circumstances, there are no hard and fast rules.

RobinHill

Thank you for the reply Alice. So someone who is fit and able and say in employment can spend the money on what they like eg. a house / invest for the future / or even a flash car etc. But because I am of poor health and unable to work (UC LCWRA) then I may well be denied the same rights? So much for equality.

tomtom256

RobinHill wrote: »

Thank you for the reply Alice. So someone who is fit and able and say in employment can spend the money on what they like eg. a house / invest for the future / or even a flash car etc. But because I am of poor health and unable to work (UC LCWRA) then I may well be denied the same rights? So much for equality.

It's nothing to do with having the same rights though, the person working is not reliant on means tested benefits.

If they where working and claiming means tested benefits, then they would be treated exactly the same as you.

huckster

Of course you can use the money to buy a more suitable new home or carry out improvements to current home.

If you want a Decision Maker to consider ignoring the divorce settlement for a period, to give you time to organise the change, then it would help if you had some documentation about preparing for the change. e.g. ask an Estate Agent to value your current home in writing and also look for a suitable new home. Or if you were looking to improve current home, to have architect/builders plans and costings.

A Decision Maker might be able to disregard capital for a period, if they have documents to show how you are going to use the divorce money to provide accommodation to better suit your disabilities. If you have no documents about any planned changes, then I very much doubt they have anything to consider.

TELLIT01

There is no automatic disregard as the money hasn't come from the sale of the house you live in. A Decision Maker may or may not have the flexibility to disregard it for a period, but that will depend on whether or not there is anything in legislation to prevent them doing so.

RobinHill

Thank you for the replies. I am not sure how TELLIT01 came to the conclusion that the money wasn't from the sale of a house that I lived in? The money is in fact a result of the sale of the family home that I once lived in. Initially we were not sure how the proceeds would be split, so an agreement was made for me to buy this one in the interim. Now an agreement has been reached regarding the settlement, and I can either look to make this property better meet my needs, or it may be better to move to one that already does so.

calcotti

RobinHill wrote: »

I am not sure how TELLIT01 came to the conclusion that the money wasn't from the sale of a house that I lived in? The money is in fact a result of the sale of the family home that I once lived in..

A house you once lived in is not the same as a house you live in.

RobinHill

That's true, but at the time circumstances were such that no one could foresee how the split would result. If we did then I would have bought another house. Housing re. bungalow w/o steps, wet room, kitchen etc are in short supply in this area. This was the best we could find at the time. Now I may well be in a position to search for something that better meets my needs now and for the future, hence the post for advice.

Mojisola

I'm sure there have been cases on here where people on benefits have received an inheritance and have been able to use that money to buy a home without it affecting their benefits so the capital doesn't always have to come from the sale of your own house.

Alice_Holt

Alice_Holt wrote: »

I would suggest when you get the settlement you notify DWP, and ask if a decision maker could give you a ruling on whether this would be regarded as deprivation of capital. Have all your evidence ready to give to the DM to support your case that it shouldn't be regarded as deprivation.

It is possible to appeal DM decisions to tribunal, should a decision go against you. The key aspect is whether you spent the money to retain a means tested benefit.

It is likely to be a matter of judgement given the circumstances, there are no hard and fast rules.

This discussion seems to have veered away from a consideration of the likely UC regulations into the realm of supposition and diversions on the subject of fairness / tenuous property links, etc.

When the OP receives his divorce settlement he should notify UC of this change of circumstances. There are disregards relating to the sale of property, but these would not IMO apply here.
If the OP wants clarification around these disregards, he would be advised to go through this DWP publication:
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/832009/admh2.pdf

I repeat this because it is key "The key aspect is whether you spent the money to retain a means tested benefit. It is likely to be a matter of judgement given the circumstances, there are no hard and fast rules."

If the OP spends all his divorce settlement on moving to a more expensive property, the danger he faces is that a DWP decision maker could decide he has deprived himself of capital and that he has notional capital (OP - google notional capital for more info).
Essentially, he will not receive UC despite having no easily accessible cash to support himself. It is not a happy position to find yourself in.

I would think that a move to a more suitable property would not constitute deprivation, however the devil is in the detail.
Say, if the divorce settlement was £430k, current house valued at £120k, and the OP moved to a £500k property (£50k on selling / buying / stamp duty / legal fees, etc). I would likely expect a DWP DM to take the view that the new property represented excessive, unreasonable expenditure.

The OP would be advised to take a pragmatic approach, should he decide to move.
Have clear evidence (including medical evidence) as to why this present property is unsuitable.
Buy another property that would be likely to be considered reasonable by a DWP DM / tribunal panel.
Have evidence to show how better this property helps him manage his disabilities, and why these new adaptions could not have been incorporated into his existing house.
Try to get an indication from the DWP of the likely ruling.
Keep sufficient cash back to live on whilst appealing a DWP decision, should it go against him.
Document everything and keep the DWP informed throughout the process.

There are no hard and fast rules, a judgement around deprivation around capital will need to be made by a DWP DM. The OP clearly can expect that if he spends his divorce settlement and remains reliant on means tested benefits, that the UC regulations will apply to him. As tomtom has remarked, it is nothing to do with "equality" .

The OP may wish to get further advice from his local advice charity, if he spends his divorce settlement, and as a consequence, faces problems with his means-tested benefits.